Mexican pension funds invest in local infrastructure
MEXICO - Seven Mexican pension funds have invested a total of MXN3.42bn (US$268.6m) in the Macquarie Mexican Infrastructure Fund (MMIF), representing 66% of the fund's total assets under management.
MMIF is the first peso-denominated fund focused on investment in Mexican infrastructure projects and has so far raised MXN5.2bn in assets.
FONADIN - a state owned agency created in 2008 to develop local infrastructure - has allocated an additional MXN1.04bn and has agreed to invest up to a total of MXN3bn to the fund. The Macquarie Group has committed MXN750m to the fund.
Macquarie Capital Mexico executive director and president Mark Ramsey said: "MMIF is an attractive investment opportunity that provides Mexican and international institutions with a vehicle to invest in a domestic infrastructure portfolio and contribute to the nation building goals set out in the government's infrastructure plan."
He added: "Mexico's Federal Government and FONADIN have established a clear and ambitious infrastructure program and Macquarie is optimistic about the role our fund will play in facilitating additional private sector investment into that program."
MMIF will target investments across infrastructure asset classes that include: roads and rail, airports and ports, water and wastewater, energy and utilities as well as social and communications infrastructure.
The pension funds' allocation comes amid strong government support for private investment in Mexican infrastructure.
In August 2007 the Mexican Federal Government announced a National Infrastructure Program mandating public and private investment in infrastructure.
Mexico has since embarked on a substantial infrastructure development program and is looking to the public-private partnership model to help deliver some of those projects.
In March 2009, Mexican pension funds agreed to invest only in local securities for the rest of the year in a bid to support the country's efforts to reactivate the national economy. (Global Pensions, March 19, 2009)
At the time, the Asociación Mexicana de Administradoras de Fondos para el Retiro (Afore) - which represents all funds operating in the country - said the fund's investment committees would also consider investing in infrastructure projects.
In particular, Afore said funds would target strategic sectors, which could have a high impact on job creation such as residential real estate and all national and local government projects.
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